Mr. Vlad Volodarski reports

CHARTWELL COMPLETES SALE OF ITS INTERESTS IN ONTARIO LONG TERM CARE PLATFORM

Chartwell Retirement Residences Real Estate Investment Trust has completed the previously announced sale of its ownership of 16 Ontario long-term care (OLTC) homes with 2,418 beds to Age Care Health Services Inc. and its affiliates, and a fund managed by Axium Infrastructure Inc. and its affiliates. Chartwell's OLTC management platform, which serves 23 owned and managed homes with 3,384 beds, has also been sold to AgeCare. Chartwell expects that AgeCare and Axium will acquire, under a forward purchase agreement, another OLTC home with 224 beds, upon completion of its development, expected to occur in the first half of 2024. The combined gross sale price of these transactions, before closing costs, taxes and working capital and other customary adjustments, is $443.2-million.

"We greatly appreciate the legacy that Chartwell's experienced and dedicated Ontario long-term care team has created in delivering quality care to our residents, as evidenced by quality indicators consistently exceeding provincial averages and a culture of continuous improvements through innovative programs like Imagine. I am confident that they will carry this legacy to the future as part of the AgeCare team," said Vlad Volodarski, Chartwell's chief executive officer. "Thank you to the Chartwell, Age Care and Axium teams for executing on this complex transaction, and for working tirelessly to ensure a smooth transition for our residents, families and employees."

"Our vision is to transform and lead quality, services and innovation in the LTC sector in Canada. With this acquisition, we will inherit talent that will allow us to strive toward our vision," said Dr. Hasmukh Patel, AgeCare's president and chief executive officer.

Transaction details

The purchasers have acquired 16 OLTC homes with 2,418 beds, of which 2,124 are Class A and 219 are Class C, and 75 retirement suites in two of the residences. AgeCare will assume management of the acquired homes as well as an additional six homes with 866 beds currently managed by Chartwell, including two homes with 258 beds which Chartwell will continue to own. Refer to the attached table at the end of this release.

The gross sale price of the acquired business is $378.7-million. Net proceeds, after property-specific debt, working capital adjustments, transaction costs and taxes, are estimated to be $148.9-million, which will be used to pay down amounts outstanding on Chartwell's secured credit facility. As a result of this sale, the majority of 2023 distributions to Chartwell unitholders are expected to be classified as eligible dividends.

The parties are subject to a forward purchase agreement for the 224-bed Ballycliffe OLTC home in Ajax, Ont., currently under development. Under the terms of the forward purchase agreement, the purchasers will acquire this home upon completion of its development, expected in the first half of 2024, for $64.5-million.

About Chartwell Retirement Residences Real Estate Investment Trust

Chartwell is in the business of serving and caring for Canada's seniors, committed to its vision of making people's lives better, and to providing a happier, healthier and more fulfilling life experience for its residents. Chartwell is an unincorporated, open-ended real estate trust which indirectly owns and operates a complete range of seniors housing communities, from independent living through to assisted living and long-term care. Chartwell is the largest operator in Canada, serving over 25,000 residents in four provinces across the country.

We seek Safe Harbor.